Bank of America CEO Ken Lewis to Retire by Year End

Embattled executive Ken Lewis to retire as CEO and step down from board.

September 30, 2009, 5:51 PM

Sept. 30, 2009 — -- Bank of America CEO and president Ken Lewis, whose controversial takeover of Merrill Lynch last year made him a flashpoint of shareholder scorn and marred decades of successful leadership, plans to retire at year end.

Lewis will end a 40-year career with the company, which he helped turn into one of the country's largest financial institutions, by Dec. 31. The bank said its board plans "to ensure his successor is selected by that date."

"Bank of America is well-positioned to meet the continuing challenges of the economy and markets," Lewis said in a statement. "I am particularly heartened by the results that are emerging from the decisions and initiatives of the difficult past year-and-a-half."

Lewis, 63, joined the bank in 1969 and was named CEO in 2001. He will step down as CEO and tender his resignation from the bank's board.

In April, shareholders angry at his decision to acquire the faltering firms Merrill Lynch and Countrywide late last year -- and then to give multimillion-dollar bonuses to Merrill executives -- voted to strip him of his chairmanship, though he remained in charge of the company as CEO.

Just a week prior to a company shareholders meeting, it was revealed that, when subpoenaed by the New York attorney general, Lewis testified that Bush administration officials had forced him to keep shareholders in the dark about the dangers of purchasing a hemorrhaging Merrill Lynch.

"The Merrill Lynch and Countrywide integrations are on track and returning value already," Lewis said in his resignation statement.

"Our board of directors and our senior management include more talent, and more diversity of talent, than at any time in this company's history," he added. "We are in position to begin to repay the federal government's TARP investments. For these reasons, I decided now is the time to begin to transition to the next generation of leadership at Bank of America."

Lewis and the bank remain under investigation by the SEC and several states' attorneys general, including Andrew Cuomo of New York.

"Ken Lewis' decision to step down will have no impact on our continuing investigation," Cuomo said in a statement.

Wall Street seemed to cheer the move: Bank of America shares were up roughly 1 percent in after-hours trading.

But banking analyst Dick Bove of Rochdale Securities said that Lewis' exit was bad for the bank.

"Ken Lewis was a phenomenally good CEO. He's made a series of very strong, positive decisions including buying Merrill Lynch and Countrywide, and therefore I think there is a definite loss to Bank of America," Bove said on CNBC this evening.

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